Onshoring strategy driving growth in UK manufacturing sales

Innovation and technology key to increased profitability and efficiency

26th October 2020

Innovation and technology key to increased profitability and efficiency

In contrast to the offshoring wave of the 1990s, where China was the go to hub for manufacture, manufacturers are no longer led on price and labour costs alone. The last two decades of rising wage costs, increased export overheads, quality concerns and IP issues have tempered the desire for offshore manufacture. Coupled with UK based companies, like Tex Plastics, investing in robot cell plastic injection moulding, innovating processes to reduce production time and increase efficiency, the Chinese advantage is eroding fast.

“As UK businesses de-risk supply chains and facilitate the adoption of more flexible, demand-driven business models, Tex Plastics is feeling the benefit as companies look to UK based plastic injection moulders.”

Nigel Partridge Sales Manager, Tex Plastics

 

Companies eager to trade off the Made in Britain image

The offshoring trend was already in decline prior to the pandemic, but throw in this and the UK leaving the EU and the trend is gaining momentum. Possibly because the UK has a long and well-deserved reputation for quality, with globally recognised systems and quality standards.

Today businesses are seeking more agile ways to reduce the time from design to production from six months to six weeks. Resulting in the ‘pull’ of Britain beginning to outweigh the lower manufacturing cost of China.

Some sectors are better placed than others to capitalise on the onshoring trend

UK businesses are far more likely to consider a suppliers capacity and skills to manufacture, the space to hold inventory, whether they can meet short supply lead times, and quantify the disruption risks if a shipment is delayed by several weeks – before deciding on where to manufacture. Prior to the pandemic, 2019 saw the UK manufacturing sector endure its longest period of sustained employment growth in four decades. With the experiences of 2020 and the uncertainty of what the future holds, Tex Plastics have experienced a significant increase in the scoping of future projects designed to be manufactured in the UK.

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